B. Waiver, Estoppel by Representation and Foakes v. Beer

• Author: John D. McCamus
• Profession: Professor of Law. Osgoode Hall Law School, York University
• Pages: 277-279

Page 277

The doctrine of waiver is commonly illustrated by reference to the decision of the House of Lords in Hughes v. Metropolitan Rwy. Co.⁶In this case, a landlord had given a notice to the tenant pursuant to the terms of the lease, requiring that certain repairs be made by the tenant within six months. The tenant replied that he was willing to do the repairs but that he would like to enter into negotiations for the sale of the lease-hold interest to the landlord and further indicated that he would not undertake the repairs during negotiations to that end. The negotiations broke off a few months later and when six months from the initial notice to repair had expired, the landlord purported to treat the lease as forfeited and brought an action to eject the tenant from the premises. The House of Lords dismissed the claim on the basis that the "course of negotiation ... of the parties ..."⁷had led the tenant to believe that the time limit for repairs would not be strictly enforced by the landlord and, accordingly, that the landlord would not be permitted to enforce it. The landlord had waived his right to insist on strict performance of the agreement and could not now insist on doing so.

This doctrine of waiver, as it has come to be known, is applicable in a variety of factual settings. For example, a purchaser of goods cannot waive a right to timely delivery and then refuse to accept the goods upon late delivery.⁸Often, as in Hughes, the doctrine will be relied on by the defendant. In other cases, however, the doctrine may be relied on by a plaintiff.⁹What is common to these situations, however, is that

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the party relying on waiver is using the doctrine to rebut the other party’s allegation that the relying party has engaged in a breach of the original contract.

For present purposes, it is useful to consider whether waiver doctrine would apply to the facts in Foakes v. Beer, where a debtor made a partial payment in return for the creditor’s promise to forgive the entire debt. Could the debtor argue that the creditor has waived the right to full payment and cannot now be allowed to claim it? At the time of Foakes v. Beer, and indeed more recently, it has been commonly understood that waiver does not apply to these facts. Presumably, this is because the degree of reliance or detrimental change of position suffered in the typical waiver case is thought to be greater than that sustained by the debtor in Foakes v. Beer. In the...